REDMOND, Wash. May 27, 2003 Microsoft is unveiling new features in its Software Assurance offering that will automatically provide customers more value, more assistance and more manageability in their Microsoft licensing. New benefits available through Software Assurance range from expanded training options and IT problem resolution support to additional product deployment and management tools. The changes are scheduled to commence in September and be available worldwide by the end of the year.

Microsoft spent the past year gathering extensive feedback from thousands of customers worldwide in an ongoing effort to give customers an offering that will add substantial business value to their licensing of Microsoft products. Businesses of every size, and at every licensing level, that purchase Software Assurance, which Microsoft introduced in May 2001, will receive added benefits related to both desktop and server products.

The new Software Assurance features which vary by licensing program, by product and by region include employee home-use rights for Microsoft Office System products; access to an array of e-learning resources; vouchers for employees to attend training courses at certified technical education centers run by Microsoft partners; access to Web-based technical support resources; and phone-based technical support available during regular business hours. Microsoft will provide these benefits at no additional charge for Software Assurance customers.

PressPass asked Bill Landefeld , Microsoft vice president for worldwide licensing and pricing, to provide background on the enhancements to Software Assurance and what these new offerings mean for customers and partners.

PressPass: What is Software Assurance?

Landefeld: Software Assurance, which is available in conjunction with Microsoft Volume Licensing programs, is a package of resources designed to provide additional benefits to customers for example, making it simpler for them to stay current with the latest and most innovative Microsoft products. The added features we’re unveiling today will give businesses even more value from Microsoft. Whereas the Software Assurance offering we introduced two years ago mainly allows customers to pay an annual price for upgrade rights, and thus have more predictable budget streams, the new offering gives them so much more. We are providing additional features that will help customers reduce costs, improve network administration and enhance employee productivity.

PressPass: What factors influenced Microsoft to make the additions to Software Assurance that are being unveiled today?

Landefeld: These additional benefits are a direct result of the feedback we have received from customers about their need for greater value as well as greater predictability and stability from Microsoft licensing. We have talked with more than 2,000 customers of all sizes and from a wide array of industries around the world. We’ve conducted focus groups and initiated Web surveys to learn more about customers’ expectations. We created a Licensing Advisory Council through which customers offer guidance to Microsoft on licensing issues and help shape our future strategies and priorities. These are just a few of the outreach efforts that have led to changes in Software Assurance.

When Microsoft introduced Software Assurance, we said that we would regularly assess the program over time and seek ongoing feedback from customers about whether the program meets their needs. The new set of features is the latest point in an ongoing cycle of Microsoft living up to these commitments.

PressPass: How will customers benefit from the latest additions to Software Assurance?

Landefeld: The additions to Software Assurance provide a much broader range of benefits that go beyond how customers acquire and pay for software licenses. It’s a package of products and services that will help customers reduce costs and more effectively deploy and manage their Microsoft software. Businesses can choose to take advantage of additional training opportunities, more technical assistance, new deployment tools and a range of other benefits that will help employees be more productive in their jobs.

We’re providing end-user training vouchers, online support and other benefits at various levels of Software Assurance at no additional charge to Software Assurance customers as part of our ongoing commitment to provide greater business value to customers. Customers are free to choose whether they want to take advantage of the Software Assurance features, and there is no set deadline for Software Assurance customers to sign up for the benefits that they want; they will receive them automatically.

PressPass: When will customers start to receive the new Software Assurance benefits, and where can they go to find more information about the offering?

Landefeld: Most of the new benefits will be available around the world in September, and the remaining additions will gradually spread to other regions in subsequent months. Since this is a worldwide program with many systems that need to be put in place, and a lot of language localization that needs to happen, it will take us a few months to roll it out widely across the world. Customers can find full details about Software Assurance and see what’s available in their region by visiting the Microsoft Licensing Web site [ http://www.microsoft.com/licensing/ ] and by contacting their Microsoft channel partner.

PressPass: How has Microsoft improved its approach — in response to customers’ and partners’ feedback that the company didn’t implement Licensing 6.0 as effectively as it should have and didn’t clearly communicate the changes?

Landefeld: Over the past 18 months, as we introduced a number of changes within Licensing 6.0 along with the rollout of Software Assurance, we definitely recognized that we didn’t communicate those changes very effectively. We’ve heard the criticism, and we’ve learned from our past missteps. The new changes in Software Assurance are only the beginning of Microsoft’s efforts to reconnect with customers and rebuild those relationships that were strained as a result of how we rolled out Licensing 6.0.

For example, one of the things that we learned with Licensing 6.0 was that we did not provide enough training for our channel partners or our Microsoft account managers to allow them to communicate effectively with their customers about the licensing changes. Our sales force and partners didn’t have the right information, which led to a great deal of confusion among customers. Our efforts this time are more thorough, more systematic, very concentrated and most of all are reaching our customers in advance so they can plan accordingly. We’ve invested significantly in educating our sales force and channel partners around the world through classroom training, onsite sessions, Web seminars and reference materials posted on the Internet so they’ll be well equipped to assist customers with these Software Assurance changes.

PressPass: What other types of benefits are Software Assurance customers seeking from Microsoft?

Landefeld: We’ve learned that a big area of concern for CIOs and IT managers who are deciding how and when to upgrade their software is how they’ll accomplish those tasks in a tight economy. If they’ve got 10,000 seats, how do they make sure that their technology investment is being utilized in a better and more comprehensive way at the desktop, and that they are actually getting value from the new products? Or if they have 100 seats, how can they make their money stretch even further with fewer resources? Those insights into our customers’ desire for end-user training and on-demand learning resources helped lead us to incorporate those benefits into Software Assurance.

Another key piece of feedback was that many customers often struggle to locate the technical information that they need from Microsoft in order to support their own IT environments. In response, we’ve added a TechNet Online Concierge chat center that is staffed by experts who can listen to customers’ issues and show them where to find the right resources on TechNet and other Microsoft Web sites. IT managers can use these online chat sessions to help locate a variety of technical information about Microsoft software, and the offering will be available to qualifying customers at no extra charge.

PressPass: How have customers responded to the changes in Software Assurance thus far?

Landefeld: We’ve only recently begun to train our internal sales force and our channel partners about the changes so that they can fan out to inform their customers. As part of that process, we’re actively soliciting as much feedback as we can. We’re very interested in seeing what the common themes are among our customers and learning whether this package of offerings will succeed in giving them greater business value from their licensing agreements.

PressPass: What do these new Software Assurance offerings mean for Microsoft’s partners?

Landefeld: They will provide a host of opportunities for our partners. The changes to Software Assurance give customers more tools, training and support; since partners have a key role in delivering these benefits, we expect Software Assurance to reinforce partners’ relationships with our mutual customers. Our reseller partners will have even more compelling benefits to show their customers when talking with them about entering or renewing licensing agreements that include Software Assurance. In addition, if you’re a Microsoft certified technical education center, we’re going to be providing vouchers for customers to attend your training sessions. That’s a huge benefit for an industry that has been sagging lately as customers have reprioritized their tight budgets and shifted away from classroom training. Also, our services and consulting partners will have greater opportunities to help customers use the new deployment tools within Software Assurance.

PressPass: What is the key difference between Software Assurance and Premier Support? How does Software Assurance work with Premier Support?

Landefeld: The additions to Microsoft Software Assurance are designed to give customers more value from Microsoft licensing by providing additional resources and tools for software deployment, training and break-fix server support for specific covered servers. By adding Premier Support, customersstep up to amanaged support relationship that covers their entire Microsoft IT infrastructure any time, day or night. Also, with Premier Support, customers receive improved response times on their Software Assurance support requests, and all support requests get the Premier Support experience. In addition, customers get priority access to proactive services such as Support Assistance which provides short-term advice and guidance foroperational issues and Premier Support Workshopsdesigned to help customers identify operational risks and address emerging issues before they occur.

PressPass: How does Microsoft respond to critics who say these new additions to Software Assurance are mainly a marketing response to increased competitive pressure?

Landefeld: This is about increasing the value of Software Assurance, building stronger relationships with customers and helping them succeed. We want to earn and maintain our customers’ loyalty, and, hopefully, we’re achieving that by providing the kinds of training, support and product upgrade benefits that customers have been asking for. We understand that our customers have a choice, and we realize that our products and programs must deliver the value that customers demand.

As far as the timing of these changes goes, we’ve spent the past year learning what our customers of all sizes want from Microsoft, and assembling a set of benefits that addresses those expectations. I believe we’ve made some strides toward working more closely — both internally and with our customer base — to deliver the right offerings in Software Assurance.

PressPass: What can customers expect to see next from Microsoft with regard to licensing?

Landefeld: These latest Software Assurance features are just another step on a continuum. We are always looking at what we can do from multiple points of view with our products, our licensing and our support offerings to help customers be more successful. As we draw closer to our customers, we’re constantly learning more about how to serve them better. That’s an ongoing mission at Microsoft.